For the past year, Bitcoin has touched the $30,000 mark, only to back down again. Across the globe, investors eagerly await an event that could potentially propel BTCUSD to new and stable heights. What if we all knew the name of this event and even its approximate date? Let’s talk about Bitcoin halving, scheduled for April 2024.
Although BTC price is far from its 60K peak, and its most starlight days appear somewhat distant, the 5-year chart reveals that Bitcoin has grown by 350% over this period of time.
The increase over the last 12 months may not appear overwhelmingly impressive. But who could say no to a +20%-per-year addition to their investment portfolio?
And what is more important – who is Mister Halving? Bitcoin halving is an event that artificially reduces the speed of mining new coins, and as a result the reward for BTC mining is cut in half. Presently, this reward stands at 6.25 Bitcoins for a successfully mined block. As you see, in 2024 it will be 3.125 BTC.
Halving is an integral element of Bitcoin's code. It decreases supply, thereby controlling the cryptocurrency inflation through a built-in limit on the total BTC volume. A similar principle applies to gold or any other precious metal. The less gold is available for mining, the more value it holds.
Plus, halving is one of the very few regular events in the crypto universe. Although it might not be akin to financial reporting, these events are kind of close to stock buyback programs. When something becomes scarcer, it tends to grow in price.
The halving occurs after every 210,000 blocks are mined. Therefore, investors are well aware of it beforehand, leveraging trades to bolster demand and BTC price. Let’s take a look at the charts illustrating the context around three previous halvings, spanning one year before and one year after each event.
The first halving occurred on November 28, 2012.
The second one on July 9, 2016.
And the third one on May 11, 2020.
On the one hand, after each halving, Bitcoin took the rising trend. But on the other, we can't definitively attribute this solely to halving. What we can ascertain is that the spring of 2024 promises excitement for the cryptocurrency market. The question of its profitability hinges upon your analysis and judgment.
And, of course, we shouldn’t forget about the final BTC halving, slated for 2140. It’ll be undoubtedly epic. But we will discuss it closer to the event.